CAG: Compensatory afforestation a hoax in M.P.

The Comptroller and Auditor General (CAG) carried out a comprehensive performance audit on the diversion of forestland for non-forest purposes in Madhya Pradesh. The result: exposure of significant cases of violations and the virtual non-execution of compensatory afforestation measures.
Himanshu Upadhyaya
has more.

The latest audit report by CAG on Madhya Pradesh for the year ending 31 March 2007 has severely indicted the state's Forest Department on allowing massive violations of conservation law. The CAG carried out a comprehensive performance audit for instances of forestland diverted for non-forest purposes during 1996-2007. The result: it has highlighted several significant cases of violations and absence of execution of compensatory afforestation measures in most of the cases.

Since the coming into force of the Forest (Conservation) Act, Madhya Pradesh has diverted 51,018 hectares of forest land for non-forest purposes for some 734 projects. While as per the provisions of the Act, the state needed to carry out compensatory afforestation on 73,213 hectares of land as mitigation measures, audit scrutiny of the records in nodal office revealed that as on June 2006, compensatory afforestation has not been carried out at all in the case of 289 projects (39 per cent shortfall at projects level) and on 13,441 hectares of stipulated land (18 per cent shortfall at land covered) after having been unable to utilize Rs.82.60 crores (75 per cent shortfall on utilisation of funds) recovered from user agencies towards the same.

(User agencies denote public or private undertakings to whom the forestland is transferred to for non-forest use. It could vary from agencies such as Narmada Valley Development Authority, a GoMP body in charge of constructing dams under Narmada Valley Development Projects, to firms indulging in mining activities in forestland such as Western Coalfields Limited.)

The worst performance was recorded by Jhabua forest division. Out of 56 plantations raised on 2,608.01 hectares at a cost of Rs 2.23 crores, 53 plantations showed low survival rate rendering Rs.2.04 crores spent on them wasteful.

A further inquiry into the records on the lines of costs and actual expenditure incurred would have made the CAG
findings look as charitable even at conservative estimates. This is because, when one links the costs of compensatory afforestation works with the work stipulated and performance reported, the figures simply do not add up.

For example, examine the records by factoring in the per hectare cost of compensatory afforestation works  the same CAG audit report quotes the figure of Rs.18,851 per hectare. It would have taken Rs.112.67 crores to carry out compensatory afforestation on the claimed 59,772 hectares. However, records reveal that having utilised merely Rs.27.17 crores, i.e., less than one fourth of the required amount, the state claimed to have carried out compensatory afforestation on 82 per cent of the stipulated land.

The CAG reports that while in-principle approval for diverting 5,829.85 hectares of forest land was granted several years ago conditional to compensatory afforestation of over 11,660 hectares of degraded forest land, the Narmada Valley Development Authority (NVDA) started compensatory afforestation works only in 2002-03. This was after passage of twelve years since a compensatory afforestation action plan was prepared in 1991. An audit scrutiny of 23 project reports prepared during 2002-04 revealed that average cost of compensatory afforestation works turned out to be Rs.1.18 lakh per hectare.

It is not that the CAG has been the first to expose the Madhya Pradesh government. The earliest critique of compensatory afforestation was articulated by Morse and Berger in their Independent Review Report in 1992 and by Ashish Kothari in his 1993 book Environmental Impacts of Sardar Sarovar Project. Based on their field work in 19 villages where compensatory afforestation works in mitigation of the forest land submerged due to Sardar Sarovar Project were carried out, Tracey Brieger and Ali Sauer questioned an Environment Sub-Group report from 1999 that claimed 98.4 per cent completion rate for the total area to be afforested and survival rates of 60 to 80 per cent for three out of the sample of five villages in an article Planting Tree, Uprooting People published in Economic and Political Weekly dated October 28, 2000.

In the year 2003, Deepti Bhatnagar, a University of California researcher undertook extensive fields work in 59 villages in Maharashtra and Madhya Pradesh verifying the compensatory afforestation claims by NCA on 1242 hectares of land and came out with a severe indictment.

But even though the present CAG report has not studied compensatory afforestation claims with specific reference to Sardar Sarovar and Narmada Sagar dams, the findings that it has reported from the detailed scrutiny of 96 projects present a severe indictment.

8,915.24 hectares of forestland was diverted for non forest land during last ten years (1997-2007). The state needed to carry out compensatory afforestation on 7,060.19 hectares of land; audit scrutiny of the records revealed that as on June 2006, compensatory afforestation has not been carried out at all in the case of 67 projects and on 5,340.19 hectares of stipulated land (76 per cent shortfall at land covered) after having been unable to utilize Rs 36.06 crores (94 per cent shortfall on utilisation of funds).

The CAG report indicting the Madhya Pradesh government.
See para 3.2 in pages 14 to 28 of this 83 page chapter.

The reason cited by the DFOs was identical: blame it on non-allotment of funds by government. However, it was also noticed in audit scrutiny that forest divisions failed to pursue non-allotment of funds and there were also cases where despite availability of funds, compensatory afforestation works were not carried out.

CAG auditors also scrutinised the evaluation reports on compensatory afforestation by the regional office of Chief Conservator of Forests (Central), MoEF, GoI at Bhopal. While a total of 78 inspections were carried out during last two years by the regional office, 67 inspection reports were made available to audit. The perusal of these 67 inspection reports revealed that compensation afforestation works were not carried out in 34 cases (51 percent shortfall) due to non-allotment of funds by government in 25 cases, non deposition of funds by user agencies in 5 cases, non availability of non-forest land in 2 cases and non suitability of land for compensatory afforestation work in remaining 2 cases. Out of 33 cases where compensatory afforestation works were carried out, 18 plantations raised during the period from 1998-99 to 2004 had failed, resulting in wasteful expenditure of Rs.8.82 lakhs.

Following such findings, audit had also requested concerned forest divisions to carry out evaluation and assessment of 20 compensatory afforestation plantations during March and April 2007, and in addition a joint verification of 4 compensatory afforestation plantations was carried out during October 2007. It was revealed that these 29 plantations failed and Rs.15.86 lakh spent on them turned out to be wasteful as survival rate of plants ranged from nil to 10 per cent.

The worst performance was recorded by Jhabua forest division, where audit scrutiny of records in May 2007 revealed that out of 56 plantations raised on 2,608.01 hectares of Land Bank during the period from 1997 to 2000 at a cost of Rs 2.23 crores, 53 plantations showed low survival rate [zero to 20 per cent] rendering Rs.2.04 crores spent on them wasteful. Similarly, in six cases of plantations raised by NVDA, the survival rate noticed was 6 to 17 per cent, rendering the expenditure of Rs.40.89 lakhs wasteful.

The audit scrutiny also revealed illegal diversion of as much as 1,507.31 hectares of forest land for non-forest purposes in 41 cases by 11 user agencies without obtaining prior approval from the Government of India. Further in two cases, illegal diversion of 8.606 hectares of forestland was noticed in excess of the extent of the forestland diversion approved by the government. None of these 43 cases invited penal action.

Further, as per provisions of the Act, 4,859 hectares of Non-Forest Land (NFL) identified for compensatory afforestation on 49 projects were to be transferred to the ownership of the state Forest Department and declared as Reserved/Protected Forests. But scrutiny of records in 13 forest divisions revealed that merely 1,865 hectares of NFL (just 38.38 per cent) was transferred to the state Forest Department and mere 1141 hectares of NFL (just 23.48 per cent) was declared as reserved/protected forest.

Again, 2994 hectares of NFL have not been transferred to the state Forest Department by user agencies belong to 8 projects where forest land diversion was permitted during the period 1982 to 1996. What does the regional office of the CCF, MoEF say about this non compliance? Have they carried out inspection reports on these plantations and what survival rates have been noticed?

The CAGs report merely records that: The DFOs stated efforts were being made to obtain and notify Non-Forest Land. Such an evasive reply is then refuted by CAG by terming the reply as not tenable in view of the guidelines issued by MoEF and terming the delay of 11 to 24 years in transfer of land and 1 to 17 years in getting the transferred land notified as reserve/protected forest as not justified.

While the CAG's report has brought forth a severe indictment, the convoluted tale of non-existent compensatory afforestation must be probed further. A large part of forestland diverted for non-forest purposes in Madhya Pradesh is connected with large dams such as Sardar Sarovar and Narmada Sagar. This CAG audit has not scrutinised those compensatory afforestation records. Citizens and legislators need to be informed about the details of all other non-compliances and violations alluded to but not detailed.

Himanshu Upadhyaya30 April 2008

Himanshu Upadhyaya is an independent researcher working on Public Finance and Accountability issues.